The Budget and the Age Pension

The week before the Federal Budget is usually a time of rash predictions and wild fiscal forecasts. This year is no exception. In fact the hyperbole has been exacerbated by a predicted $12 billion deficit and crazy guesses about the spending cuts that will need to be made.

And that brings us to Budget 2013-14 and what it will mean for the Age Pension.

Since 2008 the Rudd and Gillard Governments have raised the Age Pension by $207 per fortnight for singles and $236 per fortnight for couples (combined).

Yet despite these increases Australian Age Pensioners are on an income which falls more than $2000 short of that amount needed to fund the most modest standard of living.

It is inconceivable that such a low-level pension will be reduced in this year’s budget.

But it is entirely possible that age pensioners will not be given one penny more this year because of the fiscal constraints facing Treasurer Wayne Swan. 

And if, as is widely expected, the Liberal Coalition wins the election on 14 September, then it is highly likely that there will be no pension increases for years to come, as was the case under the Howard Government. As Mr. Hockey, the possible future Treasurer, stated last year, “the age of entitlement is over”.

So for those living below the poverty level, there is little relief in sight for a long, long, long time.

Written by Kaye Fallick